Ontario government sets 2025 rental cap for most units

Rent for some homes in Ontario will be capped below the rate of inflation next year, the provincial government announced Friday.

The Ministry of Municipal Affairs and Housing released its annual rent increase cap ahead of the long weekend, keeping landlords of some properties to increases of 2.5 per cent or less for 2025.

The average rate of inflation, the government said, was 3.1 per cent.

The cap, however, only applies to homes that were built and first occupied before Nov. 15, 2018. The government said the majority of rental homes — around 1.4 million — are still rent-controlled and were built before that date.

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The Ford government scrapped rent controls in 2018, suggesting they had stifled construction of new homes. Over the past three years, the government said, it has seen the highest number of rental housing starts in more than 30 years.

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Homes built after Nov. 15, 2018, are not subject to rent controls and can see increases at the landlord’s discretion.

Rent increases for all homes are not automatic, nor are they mandatory. Housing rules in Ontario require landlords who want to increase rent to offer 90 days’ written notice to tenants — rent cannot be raised more often than once per year.

The Landlord Tenant Board mediates disputes over rental increases, or requests to raise it above the cap in Ontario.

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